Event

Incumbent President Edgar Lungu of the governing Patriotic Front (PF) won the closely fought 11 August presidential elections securing 50.4% of the vote and narrowly avoided a second-round run-off with his main rival Hichilema of the opposition United Party of National Development (UPND) who won 47.6%. Even though voting day proceeded rather peacefully in general, it has been one of Zambia’s most controversial and violent campaign periods, marked by street confrontations between PF and UPND supporters, harassment of activists and arrests of opposition leaders. The UPND challenged the results at the Constitutional Court for alleged fraud and irregularities.

Impact on country risk

Civil discontent has flared since the drop in copper prices led to the loss of thousands of jobs, painful energy shortages and a tumbling local currency (Kwacha) causing double-digit inflation. As a result of the economic malaise, an IMF bailout package – previously postponed until after the elections – will be negotiated in the coming months for preventing a balance of payments crisis and to improve public finances. In time, this should help reboot confidence and encourage investors, yet on the other hand, unpopular fiscal reforms will be conditional and might further unhinge the already fragile political climate. Moreover, patterns of rising authoritarianism under President Lungu have become more apparent, evidenced by opposition arrests made after post-election protests and the closure of independent and critical media. Accordingly, the risk for riots and protests will remain elevated during the opposition’s legal bid and especially in case the Constitutional Court would decide in favour of the ruling PF. Analyst: Louise Van Cauwenbergh, l.vancauwenbergh@credendogroup.com